Singapore took the top spot among Asian countries in the newly-released Mercer 2010 Quality of Living Survey.

Among countries worldwide, Vienna took the number one position. Singapore leads the Asian region at number 28, followed by Tokyo, which ranked at 40.

"As the world economy becomes more globalised, cities in many emerging markets, such as Middle East or Asia, have seen a significant influx of foreign companies and their expatriate employees in recent years. Despite the economic downturn, quality of living and hardship premiums remain important means of compensating expatriates for differences in living conditions," said Slagin Parakatil, the senior researcher at Mercer, in a statement.

While Hong Kong, Beijing and Shanghai more or less retained the same rankings as the previous years, newcomer Canberra was a welcome surpise with a 26 ranking. Tokyo, on the other hand, dropped from 35 in 2009 to 40, due mostly to climate concerns.

In the Pacific, Auckland kept its position at fourth place, Sydney followed at 10, Wellington at 12, Melbourne at 18 and Perth at 21.

The recent survey also scored countries based on eco-ranking, thus, placing Wellington in the fifth spot and Kobe at the ninth. The lowest scorers in the region were Singapore at 22 and Dhaka at 220. Eco-ranking is based on water availability and drinkability, waste removal, and the like.

"Over the last few years, we have seen the quality of living index ranking change for cities in emerging markets such as Beijing and Shanghai, which impacts the hardship allowance provided to expatriates. It is important for organizations to review the index on an annual basis to keep abreast of latest changes that could impact compensation packages that companies provide to expatriates for hardship living conditions," commented Cathy Loose, the Asia Pacific global mobility leader at Mercer's information product solutions unit.

Mercer devised a methodology for assessing quality of living based on a measurement covering 10 key categories and 39 criteria. For the purpose of the study, the firm broadly characterised quality of living as the degree to which expatriates enjoy the potential standard of living in the host location. It also reflects the interaction of political, socio-economic and environmental factors in the host location.